Examination of Witnesses (Questions 60-79)
MR IVAN
LEWIS MP, MR
TONY ORHNIAL
AND MR
MIKE WELLS
30 NOVEMBER 2005
Q60 Jim Cousins: Have you had any
approaches from anyone to maybe extend the child trust fund brand
to own products that are not actually part of the Government's
own child trust fund system?
Mr Lewis: Would one example of
that be older children who are not eligible for this?
Q61 Jim Cousins: Yes.
Mr Lewis: There is a case for
looking at whether the product should be designed for older children
where the state does not necessarily have to contribute, but the
principle would be that we would want to design a suitable product.
There is a case being made. That case is still being made but
at this stage we are not doing that. There is a case for it but
we are not doing it, but what we have seen is that the market
has begun to respond to the child trust fund by beginning to develop
new products for older children. In a sense, that is very good
news because we would have hoped that would have been one of the
consequences, that it would have got providers to think in a different
way about the opportunities relating to children, so we are already
seeing market movement in that respect.
Q62 Jim Cousins: Could you just quantify
that a bit. Is this something that is simply developing naturally
or are you tracking it?
Mr Lewis: We are not tracking
it because all the time there has been a lot of pressure and a
lot of views that we ought to look at products for older children,
and therefore in a sense we are constantly re-examining whether
that would be the right thing to do. One of the reasons we have
decided at this stage not to do it is because the market is moving
in the right direction. That position is always subject to review
because we are at very, very early stages.
Q63 Jim Cousins: Because if this
is to make a significant contribution to asset-based welfare then
clearly it has got to grow beyond its existing format and limits?
Mr Lewis: Absolutely.
Q64 Jim Cousins: This scheme is the
beginning?
Mr Lewis: Yes.
Q65 Jim Cousins: And you are open
to those suggestions from the market?
Mr Lewis: Absolutely.
Q66 Jim Cousins: And you would not
necessarily take the view that the child trust fund was a Government
brand which could not be extended to other products?
Mr Lewis: No, I would not have
said that.
Q67 Jim Cousins: How did the IT stuff
work out? It has been referred to by Mr Wells. We are always interested
in government IT systems here.
Mr Lewis: We have not had many
glitches?
Mr Wells: No, we are pleased to
see some of the providers in industry and commentators who have
submitted evidence to you comment that on this one occasion the
relationship with HMRC and IT has gone well, and indeed we have
issued over two million vouchers this year without serious hitches,
so we are pleased with the way in which it has developed, yes.
Q68 Jim Cousins: Thank you. Is there
any evidence of the cashed vouchers and non-cashed vouchers being
evenly spread across the country or are there particular regions
or countries where the proportion of non-cashed vouchers is greater?
Have you done any tracking?
Mr Lewis: When you say that, do
you mean accounts, stakeholder vis-a"-vis cash, or
conversion from vouchers to accounts?
Q69 Jim Cousins: Exactly, yes.
Mr Lewis: I have not got that
information at the moment. Will we have geographical breakdown
in due course?
Mr Wells: We do not have a geographical
breakdown at the present time.
Mr Lewis: That is not built in?
Mr Wells: That is not part of
the design at the present time, no.
Q70 Jim Cousins: So it is impossible
to produce take-up information by region or country?
Mr Lewis: Or postcode, you do
not have that?
Mr Wells: We do not have that.
Mr Lewis: We will write to you
on that because I think it is a very important point.[5]
Q71 Ms Keeble: Could I just ask one question
on this, it is about delivery and take-up. Have you given any
thought to the fact that some of the most vulnerable families
actually move house quite often either because they are in temporary
accommodation or bed and breakfast or simply because due to the
nature of their circumstances they are very mobile.
Mr Lewis: People move house.
Mr Mudie: They do not have a house.
Q72 Ms Keeble: People in bed and
breakfast or in temporary accommodation or if you look at some
of most vulnerable housing estates there is a 25% turnover of
tenancies for a whole variety of reasons.
Mr Lewis: I think we do take account
of that as much as we can. I have asked that question relatively
recently internally.
Q73 Ms Keeble: What was the answer
internally?
Mr Lewis: We do everything we
can.
Mr Wells: One of the things we
try to do is work it out using the data from the child benefit
system. We have the record of where we are making the child benefit
payment to, and in terms of new children being born at the moment,
if you like, then the interregnum between child benefit being
claimed and the child trust fund voucher being issued is very
small, so we hope that the prospect of people moving in that short
time window is relatively small, but obviously there are always
going to be a few cases.
Q74 Jim Cousins: Other colleagues
have referred to the fact that this might be seen as a middle-class
initiative. Let me be absolutely frank, I have no particular political
mission to be nasty to the middle classes, I put that on the table.
Mr Lewis: You have just disappointed
some of your colleagues.
Q75 Jim Cousins: Disappointing colleagues,
of course, is an occupational hazard for everyone in this place!
My recollection is that in the past there were little penny products
that people who were not middle class used to invest into and
men in shiny brown boots used to come down the terrace and collect
the money, not that I particularly want to be thought of as somebody
who has got a thing about men with shiny brown boots either, but
in this respect those products had one particular attribute which
the child trust fund does not have, in that they were ten-year
products quite commonly, they were not permanently locked in in
the same way that the child trust fund is. There were some assurances
given at one stage that this was an issue the Government would
be looking at. Is this something that you are coming back to see
if there are circumstance where the child trust fund could be
unlocked?
Mr Lewis: Before 18?
Q76 Jim Cousins: Yes?
Mr Lewis: None at the moment.
Q77 Jim Cousins: Not at all? Not
under any circumstances?
Mr Lewis: Not at the moment.
Q78 Mr Mudie: In the original documentation
there was reference to tokens. Can you tell me what has happened
to that?
Mr Lewis: I am sorry?
Q79 Mr Mudie: Did you not catch the
question?
Mr Lewis: I did not. I have just
been corrected on a previous answer because you would want to
know I suppose, to be sensitive we should mention this, there
is one exception and that is terminally ill children, where we
do look at unlocking it.
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